The Big Break - Short Term Opportunities
With WeWork having just acquired a further 147,000 sq ft in
Shoreditch, on top of their already substantial presence in Central London, it
is difficult for us to go a day without having serviced offices in their various
guises (co-working groups etc),on the mind.
In fact, take up by serviced office providers has this year
exceeded the amount of space taken by any traditional sector, including finance
Whilst the concept of the serviced (managed, co-working etc)
office has been around for decades, it is only within the last few years that
they have exploded into the mainstream and made up a noteworthy proportion of
the Central London office market. When assessing current market trends
including the tech boom and the number of new start-ups, as well as general
uncertainty, it is easy to see why.
The offering from serviced offices acts to allay a number of
the challenges being faced by such companies. Short-term commitments, the
ability to expand and contract within the same building, no (or minimal)
capital expenditure at the start of the lease and dilapidations at expiry can
all be offered.
Of course, all of this comes at a cost to the occupier. Many
perceive these to be largely financial (which is true), however there are also other
Serviced office operators are extremely careful to protect
the identity of their clients from competitors. This gives rise to complete
anonymity in building receptions, particularly on tenant boards, which can
cause concern and confusion amongst today’s consumer market. For existing
clients, this may not be an issue, however, when trying to attract new
business, having what is perceived to be a temporary or virtual office does not
typically instil much confidence.
At the very least this can be a reflection of a company’s
size and age (something they may not necessarily want to offer up so easily).
At worst, it may raise questions over their legitimacy.
Another consideration is identity. A lot is being made
amongst the co-working community about the culture within their spaces. Having
spoken to a number of former and current occupiers, this can be a significant
draw (free beer on tap for example!). However, what about the companies that
have a specific type of working environment they want to cultivate? There are
both physical and cultural limitations to creating a unique atmosphere in
serviced offices, given that no (or limited) alterations or branding are
allowed and that the break-out/social areas are communal, giving rise to
inevitable outside influences.
‘A competitive advantage is paramount to obtaining and
maintaining market share’. This is true for any company in any sector. Whilst
we would not contest some of the advantages of serviced offices, we would argue
that many companies will put significant value behind their identity and any
risk of diluting that simply could not be considered.
So what if you are one those companies but require the
flexibility that a serviced office can provide?
Due to uncertainty in the market, a number of landlords are
now beginning to recognise tenant’s needs.
We have a number of properties, offering fit-outs,
short-term flexibility and limited dilapidations but without the inflated
rents. We can also offer rent free periods to ease cash flow and help you get
started in your new offices.
So whether you’re looking to move to a more ‘grown-up’ office
where you can establish your own culture and impress clients and staff with
your unique style or you’re looking to downsize but want to avoid being muddled
in with other companies, we can help.
We have fitted offices in
London ranging from 1,000 – 20,000 sq ft.Please refer to our property listings here, and please contact Jamie Nurcombe for further information.
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